States say EPA CO2 rule is legally flawed
A US Environmental Protection Agency (EPA) proposal to cut power plant CO2 emissions falls well short of what is required by the Clean Air Act, supporters of more aggressive action say, offering a preview of legal arguments that are likely to be raised in litigation.
A group of 18 state attorneys general yesterday urged EPA to withdraw its proposal to replace the Clean Power Plan, saying it would not lead to any "meaningful" reductions of CO2 emissions from coal-fired power plants and may also lead to higher levels of conventional pollutants.
"The proposed rule, if finalized, would be unlawful. EPA should abandon it and instead focus on implementing and strengthening the Clean Power Plan," the attorneys general said in comments on EPA's Affordable Clean Energy rule.
The group, which includes attorneys general from the District of Columbia and the top legal officials in seven cities and counties, says the proposal would "effectively rewrite the Clean Air Act" with how EPA proposes to set emissions limits for existing power plants. In addition, it fails to set a "best system of emission reduction" required by the law by ignoring a number of ways the states have already lowered power plant CO2, including through emissions trading and renewable energy mandates, the letter said.
"EPA's protestations now that it lacks information about the feasibility or mechanics of such approaches are plainly arbitrary and capricious," they said.
The group also cited a number of other flaws with the proposal, including EPA's own projection that it could lead to 1,400 premature deaths each year from higher SO2 and NOx emissions. Their arguments are echoed in separate comments filed by environmental regulators from many of the same states, as well as environmental groups.
The proposal, issued in August, would replace the Clean Power Plan, crafted by the administration of former president Barack Obama, with a less aggressive regulation EPA says will provide states with more flexibility and help keep coal-fired power plants on line. It would rely on on-site heat-rate improvements to cut CO2 emissions from coal units, rather than the broader suite of measures envisioned in the Clean Power Plan. The comment period on the proposal closed yesterday.
EPA's plan is supported by regulators in coal states including Kentucky and West Virginia, as well as industry groups, which say it will provide greater regulatory certainty than its predecessor.
The rule's "approach provides the necessary flexibility to states to set standards based upon what is reasonably achievable at each power plant upon consideration of costs, remaining useful life and other factors," the National Mining Association said in its comments.
EPA says the new rule could cover up to 600 coal-fired units at 300 power plants and would save the industry about $400mn/yr in compliance costs. The agency estimates its proposal will only reduce power plant CO2 emissions by 1.5pc from projected levels if the Clean Power Plan did not exist, leading to an overall reduction of 33-34pc from 2005 levels by 2030.
Power plant emissions last year were 28pc below 2005 levels, the result of an overall shift away from coal to lower cost natural gas and renewables.
Related news posts
Coal sales at Australia’s Whitehaven fall in Jan-Mar
Coal sales at Australia’s Whitehaven fall in Jan-Mar
Sydney, 19 April (Argus) — Australian coal miner Whitehaven reported higher production but lower sales in January-March, with the firm increasing its percentage of high-grade thermal coal sales from the previous quarter. Saleable coal volumes rose by 8pc on the year to 3.9mn t but managed coal sales fell by 7pc to 3.8mn t compared to a year earlier. Sales were 83pc high-grade thermal, higher than 72pc in October-December and 68pc a year earlier. Whitehaven said run-of-mine production at Narrabri was below expectations because of the current panel's geological challenges, leading to reliability and maintenance problems with equipment. Whitehaven's overall sales guidance for the 2023-24 fiscal year remains unchanged at 16mn-17.5mn t for 2023-24 with a unit cost guidance, excluding royalties, of A$103-113/t ($66-$72/t) which the firm said is tracking at the top end. This is because of lower output from Narrabri, which is tracking below its output guidance of 5.1mn-5.7mn t for the fiscal year to 30 June. Whitehaven finalised takeovers of Australian-Japanese joint venture BHP Mitsubishi Alliance's (BMA) 12mn t/yr Blackwater and 4mn t/yr Daunia coking and thermal coal mine in Queensland on 2 April, with initial sales and production data to be reported in its April-June production report. The two mines are anticipated to deliver 4.5mn-5mn t run-of-mine output in April-June, with Whitehaven's revenue breakdown to be 70pc metallurgical and 30pc thermal on an annual basis post-acquisition as it seeks to pivot toward coking coal. Blackwater and Daunia contributed 10.11mn t and 4mn t respectively to BMA's total output in 2023. Whitehaven plans to sell down a 20pc stake in Blackwater to global steel producers, with a process presently underway. Whitehaven views the high calorific value (CV) thermal coal market as well supported in its key Asian markets, and said tightening of sanctions on Russian exporters is containing global supply. India's continuing growth is driving demand and underpinning price sentiment, Whitehaven said, despite a softening in metallurgical coal prices during the quarter . The Argus high-grade 6,000 kcal/kg NAR price averaged $126.74/t fob Newcastle and the 5,500 kcal/kg NAR coal price $93.85/t during January-March, compared with $134.23/t and $96.80/t respectively for October-December. By Tom Major Whitehaven quarterly results Jan-Mar '24 Oct-Dec '23 Jan-Mar '23 Volumes (mn t) Managed coal production 3.9 4.2 3.6 Managed coal sales 3.8 4.7 4.1 Managed coal stocks at period end 1 1.5 1.5 Coal sales mix (%) High-grade thermal coal 83 72 68 Other thermal coal 8 19 26 Metallurgical coal 9 9 6 Prices achieved ($/t) 136 142 280 Thermal coal 136 142 280 Metallurgical coal 213 166 234 Source: Whitehaven Australian coal price comparisons ($/t) Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Wind capacity additions down 93pc under AMLO
Wind capacity additions down 93pc under AMLO
Mexico City, 18 April (Argus) — Mexico installed just 96MW of wind power capacity in 2023, a new low amid President Andres Manuel Lopez Obrador's policy to limit private sector development. Last year's wind power capacity additions were down by 93pc from the 1,281MW installed during Lopez Obrador's first full year in office in 2019, according to the Global Wind Report 2024 published by the Global Wind Energy Council. New wind power additions were also down by 39pc from the 158MW installed in 2022. Lopez Obrador's statist energy policy has sought to claw back state-owned utility CFE's market position in the face of an enormous private sector clean energy build out launched during the previous administration. Between 2016 and 2018 CFE held three long-term power auctions, contracting 7,000MW of new renewable energy projects as the government made a push to decarbonize Mexico's power matrix. But Lopez Obrador ruled out further auctions and has actively curtailed the award of new generation permits, stalling the development of 5,800MW of wind projects, according to wind energy association Amdee. Mexico has 7,413MW of installed wind capacity, accounting for 8.2pc of the country's 89,890MW total installed generation capacity, according to the energy ministry. Despite the slowed pace in Mexico, new wind installation continued to grow in Latin America last year, led by Brazil with 4.8GW to bring total onshore capacity in the country to 30.4GW in 2023. GWEC expects 28.7GW of new wind capacity in Latin America over the next five years, on top of the 50.6GW of current capacity. Globally 117GW of new wind energy capacity was installed last year, up by 50pc on the previous year and a new record. GWEC expects global wind capacity to double to 2TW by 2030, as governments agreed to triple global renewable energy capacity at the climate talks in Dubai last year. The outlook for Mexican wind power also looks more positive with both presidential candidates in the 2 June election committed to accelerating the energy transition through the build out of new clean energy capacity. Governing party candidate and current frontrunner Claudia Sheinbaum pledged to make renewable energy a "hallmark" of her administration and committed this week to investing $13.6bn in clean energy projects if elected. By Rebecca Conan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Canada furthers investment in GHG reductions
Canada furthers investment in GHG reductions
Houston, 18 April (Argus) — The Canadian government plans to have C$93bn ($67.5bn) in federal incentives up and running by the end of the year to spur developments in clean energy technology, hydrogen production, carbon capture utilization and storage (CCUS) along with a new tax credit for electric vehicle (EV) supply chains. The Canada Department of Finance, in its 2024 budget released on 16 April, said it expects to have the first planned investment tax credits (ITCs), for CCUS and renewable energy investments, in law before 1 June. The ITCs would be available for investments made generally within or before 2023 depending on the credit. The anticipated clean hydrogen ITC is also moving forward. It could provide 15-40pc of related eligible costs, with projects that produce the cleanest hydrogen set to receive the higher levels of support, along with other credits for equipment purchases and power-purchase agreements. The government is pursuing a new ITC for EV supply chains, meant to bolster in-country manufacturing and consumer adoption of EVs with a 10pc return on the cost of buildings used in vehicle assembly, battery production and related materials. The credit would build on the clean technology manufacturing ITC, which allows businesses to claim 30pc of the cost of new machinery and equipment. To bolster reductions in transportation-related greenhouse gas (GHG) emissions, the government will also direct up to C$500mn ($363mn) in funding from the country's low-carbon fuel standard to support domestic biofuel production . Transportation is the second largest source of GHG emissions for the country, at 28pc, or 188mn metric tonnes of CO2 equivalent, in 2021. But the province of Alberta expressed disappointment at the pace of development of ITC support that could help companies affected by the country's move away from fossil fuels. "There was nothing around ammonia or hydrogen, and no updates on the CCUS ITCs that would actually spur on investment," Alberta finance minister Nate Horner said. The incentives are intended to help Canada achieve a 40-45pc reduction in GHG emissions by 2030, relative to 2005 levels. This would require a reduction in GHG emissions to about 439mn t/yr, while Canada's emissions totaled 670mn in 2021, according to the government's most recent inventory. The budget also details additional plans for the Canada Growth Fund's carbon contracts for a difference, which help decarbonize hard-to-abate industries. The government plans to add off-the-shelf contracts to its current offering of bespoke one-off contracts tailored to a specific enterprise to broaden the reach and GHG reductions of the program. These contracts incentivize businesses to invest in emissions reducing program or technology, such as CCUS, through the government providing a financial backstop to a project developer. The government and developer establish a "strike price" that carbon allowances would need to reach for a return on the investment, with the government paying the difference if the market price fails to increase. CGF signed its first contract under this program last year , with Calgary-based carbon capture and sequestration company Entropy and has around $6bn remaining to issue agreements. To stretch this funding further, the Canadian government intends for Environment and Climate Change Canada to work with provincial and territorial carbon markets to improve performance and potentially send stronger price signals to spur decarbonization. By Denise Cathey Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Scotland abandons 2030 climate target to focus on 2045
Scotland abandons 2030 climate target to focus on 2045
Edinburgh, 18 April (Argus) — The Scottish government is abandoning its 2030 target to reduce greenhouse gas (GHG) emissions after the UK's Climate Change Committee (CCC) said last month Scotland would not be able to meet it, but reiterated "unwavering commitment" to its 2045 net zero goal. Scotland had an ambitious interim target to reduce GHG emissions by 75pc by 2030 from a 1990 baseline and its legally binding 2045 net zero goal date is ahead of the rest of the UK. The CCC said in March that the nation was unlikely to meet its 2030 climate goals as "continued delays" in plans and policies mean the required actions to hit targets are now "beyond what is credible". And today, Scotland's cabinet secretary for net zero Mairi McAllan said that the government "accepts the CCC's recent re-articulations" that the "2030 target is out of reach". "We must now act to chart a course to 2045 at a pace and scale that is feasible, fair and just." She said that the government will bring forward "expediting legislation" to remove the 2030 target, calling it "a minor legislative change". McAllan said climate actions are backtracking at the UK level and blamed "severe budget restrictions" by the UK government and the "constrains of devolution". Scotland is a member nation of the UK, and the Scottish parliament has some devolved powers. But energy, for example, remains a reserved matter in the UK, and decisions — including licensing, regulation and policy — are taken by the UK parliament. She said that Scotland was trying to achieve societal and economic transformation with "one hand tied behind our back". Scotland's first minister Humza Yousaf said there was no intention to "roll back" on the target to achieve net zero emissions by 2045, saying that Scotland has made faster progress than any other nation in the UK during 2019-21, but that 2030 was a "stretched" target. McAllan said annual reporting on progress will be kept but by introducing a target approach based on "five-yearly carbon budgets" — a cap on the amount of GHG emitted over a five-year period — in a similar way to the rest of the UK. Scotland missed its annual emissions-reduction target in 2021, for the eighth time in the last 12 years. The CCC's interim chair Piers Forster said today that the removal of the 2030 target was "deeply disappointing". "We are reassured that the net zero target remains in place but interim targets and plans to deliver against them are what makes any net zero commitment credible," he said. McAllan announced a series of measures that the government wants to introduce, including reducing methane emissions in farming, a Scotland-wide integrated transport ticketing system, and the quadrupling of electric car charging points. But it is unclear what will happen to Scotland's delayed climate strategy, which was due at the end of 2023. By Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more